Media

Paramount, Edgar Bronfman Jr's $4.3 billion bid

Bid submitted to acquire Shari Redstone's film and TV empire, alternative to Skydance's

20 August 2024

3' min read

Just as it seemed to have reached The End, here comes the twist on the Paramount dossier. In the end, on a knife's edge, comes an offer that could put the fate of the American media giant (with assets ranging from cable TV channels such as Mtv, Comedy Central and Cbs, to the streaming service Paramount+) destined to go down the aisle with David Ellison's Skydance Media.

Coming forward is media mogul Edgar Bronfman Jr. with a $4.3 billion bid to acquire National Amusements Inc. from Shari Redstone, the shareholder who controls Paramount Global. For now, this is the dowry, but it could also increase as Edgar Bronfman Jr has raised as much as $5.5 billion to enhance his last-minute bid on Paramount, trying to block the deal with Skydance Media.

After all, in the latter case, the last 'obstacle' to the merger to the OK of the bid submitted on 7 July by David Ellison's Skydance Media and Gerry Cardinale's RedBird Capital Partners was precisely the 45-day go-shop period from the announcement of the deal, in which Paramount could accept alternative offers. This period expires today, 21 August, but according to the filing filed with the SEC, the period can be extended until 5 September.

Edgar Bronfman Jr., a former Universal Studios executive and former president of Warner Music Group, now - as mentioned - at the head of a consortium aiming to take over Redstone's holding company: National Amusements, which in turn holds 77% of Paramount Global.

The offer includes $2.4 billion in debt and equity for National Amusements and a $1.5 billion contribution to Paramount's balance sheet, to be used to reduce debt, which is the US giant's real Achilles' heel. Also included in the offer is coverage of the $400 million to be paid to Skydance, as stipulated in the terms of the existing agreement in the event Paramount decides to prefer another offer or if the deal is not concluded on time. The word now goes to the Paramount board, which will have to decide whether to open up to this offer, perhaps extending the go-shop period until 5 September.

,On the other hand, as mentioned, there is an old acquaintance of the media world currently at the helm of Fubo, a pay TV streaming provider dedicated to sports that just in the last few days won the first round against the TV giants, Fox, Warner Bros. Discovery and Disney, who have joined in a joint venture for a new streaming sports service. The debut of Venu Sports, expected for 23 August, has been blocked on a preliminary injunction by the court, while the Antitrust Authority is awaiting a ruling on the complaint of 'anti-competitive practices' that Fubo filed in February.

Bronfman would at this point prepare to fight for Paramount, on the basis of a proposal described, in a letter to the US giant's board that emerged in the US press, as being able to 'eliminate the risks, uncertainties and costs of combining Paramount with Skydance'.

Among the arrows in the bow, as mentioned, is the possibility of improving the terms in the coming days after obtaining further commitments from a group of investors. Among Bronfman's backers would be Fortress, controlled by the Abu Dhabi fund Mubadala, Bc Partners and entrepreneurs Steven Paul, Brock Pierce and Nurali Aliyev, nephew of the former leader of Kazakhstan.

For Bronfman, the plus of the submitted offer would be that his deal could be better for Paramount's shareholders, because they would not be diluted as they would be in the Skydance deal, under which Paramount would acquire Skydance in an all-share transaction.

Andrea BiondiVicecaposervizio
Luogo: Milano
Lingue parlate: Italiano, Inglese, Francese
Argomenti: Finanza, Media, Telecomunicazioni, Economia dell'entertainment, Innovazione
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